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Tag: business model

This is the second post in a series I’m writing on running a services business1.

Also, For the sake of this conversation, I’m discussing services in the context of people who want to grow their business significantly, as opposed to maintaining some sort of local maximum.

Many services businesses achieve stable success leveraging their personal networks and local community. As I wrote in the first post in this series, though, those sources of new business can be a local maximum for a company that wants to scale. Large, densely-packed metro areas lessen the effects of the ceiling, but those environments are generally much more competitive and noisy.

No matter where you are, though, if you want to grow a services business, there are generally two main paths (in my observation and experience, at least) companies tend to follow. (There are certainly hybrid business models, but that’s another post for another day.)

My working names for the two paths are “productization and commoditization” and “specialization and customization.” Today we will talk about productization and commoditization.

I’m writing a short series2 of posts about observations I’ve made after transitioning from running a more direct-to-consumer focused business to running a B2B services business.

For a long time now I’ve been working to build out world class data-driven marketing infrastructure and teams, and most recently I’ve assembled a team that helps other companies do the same. It’s a services business called Yield Group that helps companies collect and use the data that will help them grow.

It’s been a fascinating experience coming off the heels of running a company that was primarily direct-to-consumer with a focused set of products. One of the most interesting differences to contemplate has been how services businesses scale.